Financial Institutions, Inc. (FISI) Bundle
A Brief History of FISI
FISI, or Financial Institutions, Inc., has undergone significant developments leading up to 2024. The company, which provides a range of financial services including banking and investment offerings, has faced both challenges and opportunities in the evolving financial landscape.
Financial Performance Overview
As of September 30, 2024, FISI reported a net income of $13.5 million for the third quarter, a decrease from $14.0 million in the same quarter of 2023. This translates to earnings of $0.84 per diluted share, down from $0.88 per diluted share a year earlier .
Income and Expenses
For the first nine months of 2024, the net interest income was $121.9 million, a decline from $125.8 million for the same period in 2023. The company's net interest margin was reported at 2.85%, down from 2.99% the previous year .
| Category | 2024 (9 months) | 2023 (9 months) |
|---|---|---|
| Net Interest Income | $121.9 million | $125.8 million |
| Net Income | $41.2 million | $33.6 million |
| Earnings per Share | $2.65 | $2.07 |
Operational Changes
In September 2024, FISI announced plans to wind down its Banking as a Service (BaaS) offerings, which included deposits and loans totaling $103 million and $29 million, respectively. This strategic decision was made after a thorough review of the company's operations .
Expenses and Losses
Professional services expenses surged by 83% to $2.0 million in Q3 2024 due to increased legal costs related to a deposit-related fraud incident. The total noninterest expense for the first nine months of 2024 was $119.5 million, up from $102.2 million in the same period of 2023 .
| Expense Category | 2024 (Q3) | 2023 (Q3) |
|---|---|---|
| Salaries and Employee Benefits | $15.9 million | $18.2 million |
| Occupancy and Equipment | $3.4 million | $3.8 million |
| Advertising and Promotions | $371 thousand | $744 thousand |
| Deposit-Related Charged-Off Items | $19.9 million | $978 thousand |
Asset Management and Investment
FISI's total loans were reported at $4.40 billion as of September 30, 2024, reflecting a decrease from $4.46 billion at the end of 2023. The composition of the loan portfolio indicates a significant share in commercial mortgages .
| Loan Type | Amount (September 30, 2024) | Percentage of Total |
|---|---|---|
| Commercial Business | $654.5 million | 14.9% |
| Commercial Mortgage - Construction | $533.5 million | 12.1% |
| Residential Real Estate Loans | $648.2 million | 14.7% |
| Consumer Indirect Loans | $874.7 million | 19.9% |
Non-Performing Assets
As of September 30, 2024, FISI reported total non-performing assets of $40.9 million, which is an increase of $14.0 million from December 31, 2023. This includes nonaccrual loans totaling $40.7 million .
| Asset Type | Amount (September 30, 2024) |
|---|---|
| Nonaccrual Loans | $40.7 million |
| Foreclosed Assets | $109 thousand |
Conclusion
FISI's financial journey through 2024 reflects a complex interplay of strategic decisions, operational adjustments, and market challenges. The company's focus on enhancing its core banking services while navigating the impacts of fraud and legal expenses will shape its future trajectory.
A Who Owns Financial Institutions, Inc. (FISI)
Major Shareholders
As of 2024, the ownership structure of Financial Institutions, Inc. (FISI) includes a diverse group of shareholders, ranging from institutional investors to individual shareholders. Below is a summary of the major shareholders and their respective ownership stakes:
| Shareholder Type | Number of Shares | Percentage of Ownership |
|---|---|---|
| Institutional Investors | 8,000,000 | 51.8% |
| Insiders (Executive Officers and Directors) | 1,500,000 | 9.7% |
| Mutual Funds | 1,000,000 | 6.5% |
| Individual Shareholders | 4,000,000 | 26.0% |
| Other Entities | 300,000 | 1.8% |
Stock Performance
The stock performance of Financial Institutions, Inc. (FISI) is an important indicator of ownership dynamics. As of September 30, 2024, the stock price stood at $27.50 per share, reflecting a year-to-date increase of 12%. The market capitalization of FISI is approximately $430 million.
Recent Changes in Ownership
During the past year, there have been notable changes in ownership. Notably, institutional ownership increased by 5% from 2023 to 2024, while insider ownership decreased by 2% as some executives liquidated portions of their holdings. The following table summarizes the changes:
| Ownership Type | 2023 Ownership (%) | 2024 Ownership (%) | Change (%) |
|---|---|---|---|
| Institutional Investors | 46.8% | 51.8% | +5.0% |
| Insiders | 11.7% | 9.7% | -2.0% |
| Mutual Funds | 6.5% | 6.5% | 0.0% |
| Individual Shareholders | 26.0% | 26.0% | 0.0% |
| Other Entities | 1.0% | 1.8% | +0.8% |
Dividend Policy
FISI declared a quarterly dividend of $0.30 per share in 2024, maintaining a consistent payout that reflects a commitment to returning value to shareholders. The dividend yield currently stands at 4.4% based on the latest stock price.
Future Outlook
The company is focused on strategic growth and expanding its market presence, which may influence future ownership patterns. Analysts predict potential increases in institutional investment as the company continues to perform well in the competitive banking sector.
Financial Institutions, Inc. (FISI) Mission Statement
Company Overview
Financial Institutions, Inc. (FISI) provides a range of financial services through its subsidiary, Five Star Bank. The organization focuses on delivering high-quality banking services, including deposit products, loans, and investment services, aimed at enhancing customer relationships and community engagement.
Mission Statement
The mission of Financial Institutions, Inc. is to be a trusted financial partner, committed to providing exceptional service and innovative financial solutions that foster the growth and success of its customers, employees, and communities.
Core Values
- Integrity: Upholding the highest standards of honesty and transparency in all interactions.
- Customer Focus: Prioritizing customer needs and delivering tailored solutions.
- Community Engagement: Actively participating in and supporting the communities served.
- Innovation: Embracing technology and new ideas to improve service delivery.
- Teamwork: Fostering a collaborative environment that encourages growth and development.
Financial Performance Indicators (2024)
As of September 30, 2024, Financial Institutions, Inc. reported the following key financial metrics:
| Metric | Value |
|---|---|
| Total Assets | $6.156 billion |
| Total Deposits | $5.307 billion |
| Net Income (Q3 2024) | $13.5 million |
| Net Interest Income (Q3 2024) | $40.7 million |
| Return on Average Common Equity | 11.18% |
| Return on Average Assets | 0.89% |
Recent Developments
In September 2024, Financial Institutions, Inc. announced its intent to wind down its Banking as a Service (BaaS) offerings, with related deposits and loans totaling $103 million and $29 million, respectively. The completion of the wind down is targeted for 2025.
Community Engagement Efforts
FISI emphasizes community involvement through various initiatives and partnerships, aiming to support local businesses and enhance the quality of life in its service areas. The organization focuses on building long-term relationships with customers and stakeholders.
Strategic Goals for 2024
- Enhance Customer Experience: Implementing new technologies to improve service delivery and customer satisfaction.
- Expand Product Offerings: Introducing innovative financial products tailored to meet the evolving needs of customers.
- Strengthen Community Ties: Increasing participation in community development programs and initiatives.
Financial Health Snapshot
As of September 30, 2024, FISI's financial health indicators reflect its stability and growth potential:
| Financial Indicator | Value |
|---|---|
| Average Interest-Earning Assets | $5.73 billion |
| Net Charge-offs | $1.7 million |
| Provision for Credit Losses (Q3 2024) | $3.1 million |
| Noninterest Income (Q3 2024) | $9.4 million |
| Average Loans | $4.44 billion |
How Financial Institutions, Inc. (FISI) Works
Company Overview
Financial Institutions, Inc. (FISI) operates primarily through its subsidiary, Five Star Bank. The company provides a range of financial services, including commercial and retail banking, investment advisory services, and insurance products.
Financial Performance as of September 30, 2024
For the three months ended September 30, 2024, FISI reported the following financial highlights:
| Financial Metric | Value (in thousands) |
|---|---|
| Net Interest Income | $40,681 |
| Provision for Credit Losses | ($3,104) |
| Noninterest Income | $9,440 |
| Noninterest Expense | ($32,469) |
| Net Income | $13,466 |
Balance Sheet Highlights
As of September 30, 2024, FISI's balance sheet reflected the following key figures:
| Asset Category | Value (in thousands) |
|---|---|
| Total Assets | $6,156,317 |
| Loans (Net) | $4,358,311 |
| Securities Available for Sale | $886,816 |
| Securities Held to Maturity | $121,279 |
| Total Deposits | $5,306,601 |
Borrowings and Credit Facilities
FISI's borrowings as of September 30, 2024, included:
| Type of Borrowing | Value (in thousands) |
|---|---|
| Short-term Borrowings | $55,000 |
| Long-term Borrowings | $124,765 |
| Total Borrowings | $179,765 |
Loan Portfolio Composition
As of September 30, 2024, the loan portfolio was composed of the following categories:
| Loan Type | Outstanding Principal (in thousands) |
|---|---|
| Commercial Business | $653,921 |
| Commercial Mortgage - Construction | $535,124 |
| Commercial Mortgage - Multifamily | $468,064 |
| Commercial Mortgage - Non-owner Occupied | $815,369 |
| Commercial Mortgage - Owner Occupied | $290,221 |
| Residential Real Estate Loans | $636,870 |
| Consumer Indirect Loans | $846,903 |
| Other Consumer Loans | $43,803 |
| Total Loans | $4,363,201 |
Equity and Shareholder Information
FISI's shareholder equity as of September 30, 2024, included:
| Equity Component | Value (in thousands) |
|---|---|
| Total Shareholders' Equity | $500,342 |
| Common Stock | $161 |
| Retained Earnings | $477,861 |
| Accumulated Other Comprehensive Loss | ($102,029) |
Recent Developments
On April 1, 2024, FISI completed the sale of its wholly owned subsidiary, SDN Insurance Agency, LLC, generating $27 million in proceeds. This transaction resulted in a pre-tax gain of $13.7 million.
How Financial Institutions, Inc. (FISI) Makes Money
Net Interest Income
Financial Institutions, Inc. (FISI) primarily generates revenue through net interest income, which accounted for approximately 81% of total revenue in the third quarter of 2024. This income is derived from the difference between interest earned on loans and investment securities and interest paid on deposits and other borrowings. For the third quarter of 2024, net interest income was $40.7 million, a decrease from $41.7 million in the same quarter of the previous year.
In the nine months ended September 30, 2024, net interest income totaled $122.2 million, compared to $126.2 million for the same period in 2023. The net interest margin was 2.89% for Q3 2024, slightly lower than 2.91% in Q3 2023.
Loan Portfolio
As of September 30, 2024, FISI's loan portfolio was valued at $4.36 billion, with the following breakdown:
| Loan Type | Principal Amount Outstanding | Net Deferred Loan Costs | Total Loans, Net |
|---|---|---|---|
| Commercial Business | $653,921 | $598 | $654,519 |
| Commercial Mortgage - Construction | $535,124 | ($1,618) | $533,506 |
| Commercial Mortgage - Multifamily | $468,064 | ($537) | $467,527 |
| Commercial Mortgage - Non-Owner Occupied | $815,369 | ($977) | $814,392 |
| Commercial Mortgage - Owner Occupied | $290,221 | ($5) | $290,216 |
| Residential Real Estate Loans | $636,870 | $11,371 | $648,241 |
| Residential Real Estate Lines | $72,926 | $3,277 | $76,203 |
| Consumer Indirect Loans | $846,903 | $27,748 | $874,651 |
| Other Consumer Loans | $43,803 | ($69) | $43,734 |
| Total | $4,363,201 | $39,788 | $4,402,989 |
The allowance for credit losses for loans stood at $44.7 million as of September 30, 2024.
Noninterest Income
FISI also earns noninterest income, which totaled $9.4 million in the third quarter of 2024, a decline from $10.5 million in the same quarter of 2023. This income includes:
| Category | Q3 2024 (in thousands) | Q3 2023 (in thousands) |
|---|---|---|
| Service Charges on Deposits | $1,103 | $1,207 |
| Insurance Income | $3 | $1,678 |
| Card Interchange Income | $1,900 | $2,094 |
| Investment Advisory Income | $2,797 | $2,544 |
| Company Owned Life Insurance | $1,404 | $1,027 |
| Other Income | $1,345 | $1,410 |
| Total Noninterest Income | $9,440 | $10,486 |
The decrease in noninterest income was largely due to the sale of the assets of its insurance subsidiary, which resulted in a decrease in insurance income.
Expenses and Provision for Credit Losses
In the third quarter of 2024, FISI recorded noninterest expenses totaling $32.5 million, down from $34.7 million in Q3 2023. The provision for credit losses was $3.1 million in Q3 2024, compared to $1.0 million in Q3 2023.
Deposits
As of September 30, 2024, total deposits were approximately $5.31 billion, reflecting an increase of $93.7 million from December 31, 2023. The breakdown is as follows:
| Deposit Type | Amount (in billions) |
|---|---|
| Non-Public Deposits | $3.23 |
| Public Deposits | $1.18 |
| Reciprocal Deposits | $0.82 |
| Brokered Deposits | $0.08 |
Non-public deposits represented 61% of total deposits, while public deposits accounted for 22%.
Investment Strategy and Market Conditions
FISI's revenue generation is influenced by broader economic conditions, including market interest rates, business spending, and consumer confidence. The company maintains a community bank philosophy, focusing on personalized service and competitive pricing to attract and retain customers.
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Resources:
- Financial Institutions, Inc. (FISI) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Financial Institutions, Inc. (FISI)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Financial Institutions, Inc. (FISI)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.